According to a recent report from Bitfinex, the decline in the price of Bitcoin below $43,000 can be attributed to miners selling off their reserves. Analysts argue that miners are taking advantage of the current high prices to maximize their profits before the upcoming decrease in mining rewards scheduled for April. This coincides with the halving event, where Bitcoin rewards will be reduced, making mining less profitable. The report highlights that miners have a significant influence on market liquidity and price determination. It also mentions that there has been a significant decrease in Bitcoin mining reserves since the approval of Bitcoin spot ETFs. The report suggests that further sales may be imminent as well.
Some analysts maintain a bullish attitude towards the future of Bitcoin despite its recent decline. Markus Thielen from 10x Research predicts a further 65% increase in the price of BTC by the end of the year, reaching $70,000. Thielen cites factors such as the macroeconomic context, favorable monetary factors, and growing demand from traditional investors as reasons for this optimistic outlook. He also emphasizes the historical performance pattern of Bitcoin and its correlation with US presidential election cycles and halving years.
Cathie Wood, CEO of ARK Invest, believes that Bitcoin is increasingly becoming digital gold. She sees it as a risk-free asset and a safe haven during periods of economic instability. Wood points out that Bitcoin performed well during last year’s regional banking crisis and suggests that there is a gradual shift from gold to Bitcoin as a valuable asset based on a long-term bullish trend.
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